SYDNEY -- Australian police have seized 558 kilograms (1,230 pounds) of crystal methamphetamine and heroin with a street value of up to 500 million Australian dollars ($525 million) smuggled into the country in a shipment of terracotta pots.

Australian Federal Police say four Hong Kong nationals and three Australians were arrested in Sydney on Monday. Each faces a potential life sentence if convicted on drug charges.

Police said Tuesday that the 306 kilograms (675 pounds) of crystal meth – or ice – is the largest seizure of the drug in Australia. The 252 kilograms (556 pounds) of heroin is the third-largest haul of its kind.

The U.S. Drug Enforcement Administration alerted Australian authorities to the plot last August. Police will not say where the drugs came from.

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Australian Federal Police (AFP) display ceramic vases used to conceal 525 million USD worth of crystal methamphetamine ('ice') and heroin after smashing a Hong Kong-based international drugs syndicate in Sydney on July 31, 2012. It was the largest haul of ice (306 kilograms) in Australian history and the third-biggest heroin bust (252 kilograms) and was the culmination of an 11-month operation following a tip-off from the US Drug Enforcement Administration. (TORSTEN BLACKWOOD/AFP/GettyImages)

Australian Federal Police (AFP) guard 525 million USD worth of crystal methamphetamine ('ice') and heroin after smashing a Hong Kong-based international drugs syndicate in Sydney on July 31, 2012. (TORSTEN BLACKWOOD/AFP/GettyImages)

Australian Federal Police (AFP) guard 525 million USD worth of crystal methamphetamine ('ice') and heroin after smashing a Hong Kong-based international drugs syndicate in Sydney on July 31, 2012. (TORSTEN BLACKWOOD/AFP/GettyImages)

Australian Federal Police (AFP) guard 525 million USD worth of crystal methamphetamine ('ice') and heroin after smashing a Hong Kong-based international drugs syndicate in Sydney on July 31, 2012. (TORSTEN BLACKWOOD/AFP/GettyImages)

Australian Federal Police (AFP) deputy commissioner Andrew Colvin announces the seizure of 525 million USD worth of crystal methamphetamine ('ice') and heroin after the AFP smashed a Hong Kong-based international drugs syndicate in Sydney on July 31, 2012. (TORSTEN BLACKWOOD/AFP/GettyImages)